The Financial Benefits of Sharing a House

by Mike on September 24, 2013

All college students can probably relate to the financial benefits of sharing a house or apartment to keep their living costs down when they are poor students but how often do you think about this when your older. I found myself in the somewhat unenviable position of owning my own home after a breakup (well I own some of it the bank owns some as well of course) which of course means I am in charge of making sure the mortgage and loan payments, the rate, insurance etc etc all get paid on time. Its very easy to take for granted the ability to pay for bills and other outgoings when you have two incomes but what about when you only have the single incoming but the same outgoings? So I once again find myself sharing my home with someone else.

The Good the Bad the Ugly of Sharing your home.

Its not always smooth sailing or easy living with someone who may or may not be a friend or acquaintance. There are some pros and cons for having either or and I can sum these up with my experiences sharing my home over the last three or so years. As a side note recently I have been thinking about one of my previous articles about investing with friends in property. One of my family members is currently doing the real estate purchase thing and this made me ponder doing something similar myself and doing it as a group.

The Previous Previous Roommate

The one and only time I shared my place with a male. IT JUST DIDN’T WORK. I found sure we got along okay but perhaps all those behavioral things males do compared to female qualities got to me. I felt he was a bit intrusive in my life and was always trying to participate in what I was up to. I also felt he was untidy, made a mess and didn’t clean up after himself. Thinking about it now I am sure other housemates could say the same about me in return before I matured a little so perhaps what I was seeing here was my behavior reflected in him. He was just acting the same way I was to fit in.

The actual financial benefit was even better than the most recent experiences because as usual he had a higher income to dig into for his share of rent and I surprisingly found he was willing to pay more than females for place to share!

The Previous Roommate

The previous roommate was a female friend who moved in and needed a place to live. We got along well with her having a busy little social life so I actually didn’t run into her too often. When we did we were quite comfortable watching TV or a movie together. We both were quite tidy about cleaning and she kept her part of the house neat and tidy. In contrast to the previous male housemate the only downside is being a part time worker/student she couldn’t quite pay me what I was after. Additionally she had a funny dietary requirement so we didn’t eat together and so battling for cooking space in the kitchen was often going on. Being friends also meant I felt she took advantage of me when she moved out and the process of removing all her stuff and cleaning up dragged on for some weeks.

The Current Roommate

My current roommate is someone I didn’t know before she moved in (as a contrast to the first two) and yet things seem to be moving along okay. We both have pets and so this gives us some common ground to share quietly without having to work at it. Sure we hang out and watch TV but we are separate individuals and she spends a bit of time in her room. Another contrast there is quite a different power relationship. We are comfortable but at the same time the relationship is very structured. The home is mine, in my name and its a landlord versus tenant sort of relationship. Another difference her are our ages. She is quite a bit younger than me and so perhaps this also sets quite firm boundaries. The financial benefits of sharing a house with her are quite definable too. She needed a home for her and her dog to start a career in my area and so she was quite prepared to spend more to find the right place. She is paying a bigger share of the bills as well. All in all this is a win win situation for me!

So what did I find the financial benefits of sharing a house were?

As a small business owner I can tell you I watch my personal costs quite closely as this is my biggest cost to the business. Me surviving. Having a housemate here from a pure numbers perspective equals the following.

Approximately $7280 per year in rent.

My rates per year are $2600 (including water)

Home and contents insurance $1100

Pest Control $220

Gardening & Maintenance $600

Leaving me in front by$2760

Electricity we split the bill which will save me approximately $460 off my electricity bill. Its debatable that this is a saving but its money I am not spending I suppose.

To conclude all this means to me that I have approx $200 a month to go on my repayments to the bank. But more importantly all those other things above are now paid for by my housemate. To me this means I can save / pay off approximately $4520 MORE per year to my bank!

So do you think this is worth it?

Male or female housemates? Whats your experience in sharing a house or apartment? Have you found a housemate that is worth living with for the financial benefits of sharing a house?